Delhi High Court: In a petition filed by Kewal Krishan Kumar (petitioner) was one of the directors, promoters, and guarantors of Shakti Bhog Foods Limited seeking bail under Sections 3 and 4 of the Prevention of Money Laundering Act, 2002, Jasmeet Singh, J., granted bail to the applicant as he has been in custody for over 18 months and investigation qua the applicant is complete but no chargesheet has been filed.
The Applicant was one of the directors, promoters, and guarantors of Shakti Bhog Foods Limited who availed of various loan facilities from a consortium of banks led by the State Bank of India from 2006 onwards, and in order to acquire more loan funds from Banks, the company resorted to round tripping and money laundering using its various group companies as platforms. SBFL had rotated its funds to group companies in the form of share investment, share application money, share premium, inter corporate deposits, compulsory convertible debentures, loans and advances and inter group purchases with the sole intent to launder and change colour of these loan funds from liabilities to assets.
The bail applicant is 70 years of age and has a chronic medical history of having undergone bariatric surgery, is a chronic case of varicose veins, and is functioning with 20% stomach capacity due to bariatric surgery. In addition, he has gallbladder stones (Cholelithiasis) and suffers from seizures, behavioral disorders, and hypertension. The ground of bail is regarding the proviso to section 45(1) Prevention of Money Laundering Act (PMLA) that the Applicant is sick and infirm.
The Court noted that when the sickness or infirmity is of such a nature that it is life-threatening and requires medical assistance that cannot be provided in penitentiary hospitals, then the accused should be granted bail under the proviso to section 45(1) PMLA. Thus, a combined reading of the PMLA Objects and Reasons, Finance Bill, 2018, the 268th LCI Report indicates that the proviso to Section 45(1) PMLA is a relaxation for sick or infirm persons provided their sickness or infirmity is so grave that it is life endangering and cannot be treated by jail hospitals. However, no straight jacket formula can be laid down as to what is the level of sickness that a person is to suffer to entitle him to bail and Courts do not possess the medical expertise to sit in appeal of the opinion of the Medical Board.
As per the medical report, dated 11-02-2023 prepared by a board of doctors consisting of a physician, neurologist, psychiatrist, and surgeon, it has been opined that the applicant is not ‘sick’ to be granted bail under proviso to Section 45(1) PMLA. The ailments that the applicant is suffering from are not grave or life-threatening that entitle him to bail on medical grounds.
Thus, the Court concluded that the Applicant cannot be termed to be ‘sick’ to fall within the proviso to section 45(1) PMLA.
In terms of the ‘infirmity’ of the applicant, the Court opined that infirmity is defined as not something that is only relatable to age but must consist of a disability that incapacitates a person to perform ordinary routine activities on a day-to-day basis. However, a perusal of the applicant’s medical records shows that he has had seizure disorders and mild behavioral disorders which coupled with old age is a cause of concern and shows the seriousness of the applicant’s infirmities.
As per a recent medical report, seizures have become more frequent than before, which makes him more vulnerable to injuries such as hemorrhage, or which the dosage of medication has been increased. Thus, the Court held that infirmities in a senile stage combined with constant ‘attendant’ support coupled with frequent seizures and abnormal behavioral disorder make the Applicant ‘infirm’ under the proviso to section 45(1) PMLA.
The applicant, being declared ‘infirm’ and satisfying the triple test of flight risk, influencing any witness and tampering with evidence was granted bail subject to terms and conditions.
[Kewal Krishan Kumar v Enforcement Directorate, 2023 SCC OnLine Del 1547, decided on 17-03-2023]
Advocates who appeared in this case :
Mr. Mohit Mathur, Sr. Adv. with Mr. Vikas Arora, Mr. Amit Bhatia, Ms. Radhika Arora, Mr. Siddharth Singh, Mr. Abhay Sachan, Advocate for the Petitioner;
Mr. Zoheb Hossain, Special Counsel for E.D. with Mr. Vivek Gurnani, Mr. Kalp Samaiya, Advocates for the ED.